Management Company Woes

iwbus

Please bear with me, this is a stressy and probably long post!

I live in a house which is divided into 5 flats, one of which I own and another is owned by the chap who "runs" (I use the term loosely) the management company for the whole house. At the start of this year we (I co-habit with my partner) asked when the communal entrance hall would be redecorated, recarpeted etc. as it's very scruffy. We recieved a very positive response which made us think things would get underway very soon and that was that.

In April we decided to put the flat on the market as we wanted to move up the property ladder to a house

In May, due to lack of action, we sent another letter asking when repainting work would start and heard nothing, by this time the communal gardens were very overgrown so we requested that they be tended too. No response. My partner went to CAB and, while asking what could be done about the gardens, mentioned that we hadn't had any accounts from the management company for a year or two and no request for any money had been made. Companies House website shows (today)
Next Accounts Due: 30/04/2006 OVERDUE
My partner mentioned that we had searched the CH website to which the advisor said "I think this is more serious than just an overgrown lawn my dear". They advised us to take the flat off the market as it couldn't be sold if the finances of the management company weren't sorted. They also said we should ask for details of the insurance for the whole house just to check we were actually insured

In June we sent at least 4 letters to him asking for details of the accounts and insurance, CAB said it is actually a legal requirement for the accounts to be provided within 1 month of any request. At the end of June he provided the details of the house insurance with the promise that the accounts would be delivered to us the next weekend. We are still waiting for the accounts as I type this and the insurance seems to be invalid (I have brought to his attention) as there is a question in the documentation which asks if there are trees within 10 metres of the building (there areand he has said there aren't).

SO
- We have sent multiple requests to him and the only response has been the delivery of insurance documentation, none of our letters have even been acknowledged
- We have been forced to withdraw the flat from sale due to his negligence
- We may well not be insured (which would affect my mortgage too as adequate insurace is a pre-requisute)
- We have been put under undue stress which has made my partner seriously considering moving back with her parents. I also have to be careful with having problems at home as I'm a bus driver so need my mind on the job and not worrying about my flat

CAB have advised us to go and see a solicitor but I think we will be shopping around as the first one I contacted today wants to charge 136 quid PH

Does anybody have experiences of similar problems with "management" companies? What do you think the solicitors first move would be? Can we expect any kind of compensation for losing the sale of the flat etc?

P.S. When the gardens were messy we didn't have any viewings arranged by the agents. We spent a whole Sunday morning in a work team of 7 people to get it sorted and had 2 requests for viewings in 4 days. Shame we couldn't have sold it anyway although the estate agent should've asked about the state of the finances first anyway

P.P.S. We put the letters under matey's door, we don't "post" them as such. We haven't confronted him as he leaves early in the morning and gets home late at night. He does have weekends to do stuff though, usually golf

If you've read this far then thank you very much. If there's anything I've missed then please ask, if there's anything you feel may help then go ahead. This isn't so much a question post as a place to get things off my chest and out of my head

paint

If it was me, the first thing I would do is to knock on the doors of the other 3 residents to tell them that their buildings insurance is invalid! They'll likely be extremely grateful to you for bringing it to their attention (I know I would be!) and there's power in numbers. He may be able to ignore or brush off one person requesting information, but if the remaining leaseholders are also knocking on his door he can't hide so easily.

Not to mention the fact that if you need to see a solicitor it will be much cheaper to divide the costs between the 3 flats rather than bear the cost yourself.

Any further correspondence with the chap who runs the management company I would send via recorded delivery and keep copies. In fact, it might be worth sending all correspondence to date via recorded delivery with a covering letter to state exactly what is being enclosed and that you're re-sending it since you have had either no reply or an unsatisfactory reply. At least if he's had to sign for something you have a decent chance of proving that your letters have been sent and received if any legal action is required further down the line. It also says to him that you're deadly serious.

I can't stress how serious it is that the buildings insurance may be invalid, though I'm sure you're already aware of this. What if there was a fire? Unlikely I know, but frightening nonetheless.

Do you have a copy of your lease or something from the Management Company which explicitly states what the roles and resoponsibilites of the management comapny are?

Doozergirl

I suspect your 'managing agent' is your freeholder and it may be a case of getting things done yourself if he really can't be bothered. Your priority here is to sell and be done with it, not to quibble or get into legal wrangles.

You need a solicitor to sell the house, so once you've found a decent quote from a solicitor you're happy with I think you should mention that you have not been billed service charge and doubt that accounts are available as a result. Change agent, say nothing and I think you may get away with it. Our first flat was bought and then sold without the managing agent providing accounts or buildings insurance as our money was going into his pocket and none of the other flats were paying. Neither solicitor picked up on this at all and the stress was virtually unbearable for my OH at the time, especially with a tiny baby, but he was just relieved when we got out.

If you really feel the work needs doing in order to sell, in true MSE style, why don't you take it upon yourselves to organise the flats into getting the communal areas done? You will have to get funds from everyone but it'll probably work out cheaper for you all. I think you'll probably get away with just a half decent garden which costs you nothing but time.

As you have no plans to stay, just look for the quickest and cheapest way out. As soon as you start the whole letter writing thing, you're going to have to start declaring this stuff when you sell, so best to keep quiet. My advice isn't exactly best for all involved, but you have to think of yourselves as most people do in the property game.

paint

Doozergirl wrote:

My advice isn't exactly best for all involved, but you have to think of yourselves as most people do in the property game.

I think you have a moral obligation at least to tell the other residents that their buildings insurance is invalid. Are there potentially any legal consequences for not doing so?

iwbus

paint wrote:

I think you have a moral obligation at least to tell the other residents that their buildings insurance is invalid. Are there potentially any legal consequences for not doing so?

Of the other 3 flats, 1 is owned and the owner is normally around so that's easy to do. The other 2 are let and we have no idea who owns them. We have spoken to the letting agent about having no insurance and the problems we've had but they didn't seem particularly bothered and haven't said any more to us. Is there any way we can find out who owns them?

iwbus

paint wrote:

Do you have a copy of your lease or something from the
Management Company which explicitly states what the roles and resoponsibilites of the management comapny are?

I think I've got a copy of the lease somewhere but I don't know if it says about the r&r of the company. Should it?

Kaminari_2

Does the land registry have information about the holders of the leasehold? If so you could do a quick search on their website, it will cost you £2 per search. I'd first ask the other owner if they know who the other leaseholders are. Might save you some time and money and if you are sending letter make sure they are recorded.

hazeyj

Your current mortgage company would withdraw their funding immediately if they became aware that your building wasnt insured as your in breach of your mortgage.. Your freeholder would also be in breach of his mortgage (if he has one) and in breach of the actual lease. Really though you should have queried before now why they didnt demand any charges..easy to say in hindsight I know.

Your lease(s) will state who the landlord is or I would contact the sol you used to buy the place initially to see if they could help you with this serious problem. You really should seek advice very quickly. As a poster above said, if your was to flat burn to the ground this evening (god forbid) you would be homeless AND would still have to pay the morrtgage back.

Is this person who runs the management company the freeholder? Is is def a leasehold flat you own or could you possibly own a share of the freehold?

You need to have a good read of your lease really.

Please keep us informed of updates.

Good luck